[Federal Register Volume 74, Number 246 (Thursday, December 24, 2009)]
[Rules and Regulations]
[Page 68382]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-30295]
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DEPARTMENT OF DEFENSE
Defense Acquisition Regulations System
48 CFR Parts 225 and 231
RIN 0750-AF85
Defense Federal Acquisition Regulation Supplement; Allowability
of Costs To Lease Government Equipment for Display or Demonstration
(DFARS Case 2007-D004)
AGENCY: Defense Acquisition Regulations System, Department of Defense
(DoD).
ACTION: Final rule.
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SUMMARY: DoD has issued a final rule amending the Defense Federal
Acquisition Regulation Supplement (DFARS) to address limitations on the
allowability of contractor costs associated with the leasing of
Government equipment for display or demonstration. The rule specifies
that monies paid to the Government for the leasing of Government
equipment are unallowable, except in the case of foreign military sales
contracts.
DATES: Effective Date: December 24, 2009.
FOR FURTHER INFORMATION CONTACT: Mr. Julian Thrash, Defense Acquisition
Regulations System, OUSD(AT&L)DPAP(DARS), IMD 3D139, 3062 Defense
Pentagon, Washington, DC 20301-3062. Telephone 703-602-0310; facsimile
703-602-0350. Please cite DFARS Case 2007-D004.
SUPPLEMENTARY INFORMATION:
A. Background
DoD Instruction 7230.08, Leases and Demonstrations of DoD
Equipment, contains policy on the leasing of DoD equipment to defense
contractors for demonstration to foreign governments or for display or
demonstration at international trade shows and exhibitions. In addition
to the leasing of equipment, contractors may obtain related support
services from DoD. The Instruction provides that the contractor leasing
the equipment may not recover the DoD charges associated with the
lease, directly or indirectly through any U.S. Government contract,
except to the extent chargeable to contracts for foreign military
sales. For consistency with the policy in DoD Instruction 7230.08, this
final rule adds DFARS text to address the limitations on the
allowability of costs associated with the leasing of Government
equipment.
DoD published a proposed rule at 72 FR 69176 on December 7, 2007.
DoD received no comments on the proposed rule. Therefore, DoD has
adopted the proposed rule as a final rule without change.
This rule was not subject to Office of Management and Budget review
under Executive Order 12866, dated September 30, 1993.
B. Regulatory Flexibility Act
DoD certifies that this final rule will not have a significant
economic impact on a substantial number of small entities within the
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601, et seq.,
because the rule is consistent with existing DoD policy, and applies
only in those situations where a contractor chooses to lease military
equipment for display or demonstration purposes.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply, because the rule does
not impose any information collection requirements that require the
approval of the Office of Management and Budget under 44 U.S.C. 3501,
et seq.
List of Subjects in 48 CFR Parts 225 and 231
Government procurement.
Amy G. Williams,
Editor, Defense Acquisition Regulations System.
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Therefore, 48 CFR Parts 225 and 231 are amended as follows:
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1. The authority citation for 48 CFR parts 225 and 231 continues to
read as follows:
Authority: 41 U.S.C. 421 and 48 CFR Chapter 1.
PART 225--FOREIGN ACQUISITION
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2. Section 225.7303-2 is amended by revising paragraph (b) and adding
paragraph (e) to read as follows:
225.7303-2 Cost of doing business with a foreign government or an
international organization.
* * * * *
(b) Costs not allowable under FAR Part 31 are not allowable in
pricing FMS contracts, except as noted in paragraphs (c) and (e) of
this subsection.
* * * * *
(e) The limitations in 231.205-1 on allowability of costs
associated with leasing Government equipment do not apply to FMS
contracts.
PART 231--CONTRACT COST PRINCIPLES AND PROCEDURES
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3. Section 231.205-1 is added to read as follows:
231.205-1 Public relations and advertising costs.
(e) See 225.7303-2(e) for allowability provisions affecting foreign
military sales contracts.
(f) Unallowable public relations and advertising costs also include
monies paid to the Government associated with the leasing of Government
equipment, including lease payments and reimbursement for support
services, except for foreign military sales contracts as provided for
at 225.7303-2.
[FR Doc. E9-30295 Filed 12-23-09; 8:45 am]
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